The Vietnamese government has instructed several ministries to ease their grip on foreign labor management in a gesture apparently aimed at assuaging a disgruntled corporate sector that is crying foul over a dire shortage of skilled workers.
On July 8, Prime Minister Nguyen Tan Dung issued a resolution which, among other things, asked various ministers to alter Vietnam's new and unpopular work permit requirements.
A new decree on foreign labor that took effect last November forced employers to prove that they needed to hire foreign workers. The decree also reduced the validity of work permits for a broad category of foreign workers from three to two years--a provision that could exacerbate the shortage of skilled workers plaguing both foreign and local companies, executives and analysts say.
The decree mandated that work permit applicants have both a four-year university degree with a major in their precise employment field and five years of experience in said field. Critics have argued that this requirement ruled out a large number of foreign workers who could make valuable contributions to Vietnam's economic development.
For instance, many qualified English teachers are recent graduates of four-year university programs who do not necessarily have five years of experience teaching English, experts say.
The government eventually heeded the criticism and issued a resolution last week asking concerned ministries to amend the rules on foreign investment in the education sector to make life easier for foreign workers to obtain permits.
“The most welcome change was the reversion to the prior rule of five years of related professional experience or a four year university degree, as opposed to the recent, controversial rule requiring both,” Fred Burke, managing director of the Ho Chi Minh City-based law firm Baker & McKenzie (Vietnam) Ltd, told Thanh Nien News.
During a meeting between Prime Minister Nguyen Tan Dung and the business community last month, Burke pointed out that Vietnam's existing laws would bar Bill Gates and Steve Jobs from getting work permits--drawing wide applause from the room.
New draft changes to the law “would enable Bill Gates and Steve Jobs to get work permits to work for employers in Vietnam, provided they stuck to their respective areas of expertise,” Burke said.
Phan Thi Hoang Hoa, CEO of Apollo Vietnam (a fully foreign-owned English language training company), said the changes are indicative of the government acknowledging the legitimate concerns of the corporate sector.
“We understand that the government has to keep more jobs for locals but still, such changes are needed to allow greater mobility for skilled foreign workers, particularly in the education sector,” Hoa said.
Multinationals say they invest in Vietnam due to the large labor market, low costs, and access to local and foreign markets, and some of their investments need specially-trained staff with a level of skill not immediately available in Vietnam.
Singapore and Malaysia also apply strict regulations on foreign labor, though industrial and office workers in both neighboring countries apply for specific work permits that distinguish between "workers," "technicians,” "managers” and "professionals."
Vietnam applies almost the same requirements across the board.
But despite the positive changes set forward in the draft laws, insiders are concerned that it may take some time for them to materialize.
Under the resolution, Prime Minister Nguyen Tan Dung asked the labor and education ministries to work with each other to amend decrees on work permits and foreign investment in the education sector and send them back to him for approval.
“One of our concerns is that some local authorities may not apply these adjustments…immediately but will wait for official amendments to the above decrees, which may take time,” Burke said.